The Philippines improved its ranking by one place in the 2020 World Competitiveness Yearbook to 45th among 63 countries from 46th in 2019.
It moved up the rankings this year, buoyed by an increase in international trade and steady performance in the labor market. The Philippines last year climbed four spots from its 2018 rank.
The report said the Philippines remained at 13th place out of 14 countries in the Asia-Pacific region.
The WCY has been published by the International Institute of Management Development since 1989 with the AIM Rizalino S. Navarro Policy Center for Competitiveness as its Philippine partner, supplying data from national sources and helping distribute the executive opinion survey.
The WCY evaluates competitiveness using 337 criteria spread across four competitiveness factors: economic performance, government efficiency, business efficiency and infrastructure.
About two-thirds of the indicators are based on hard data, while the remaining are perceptions-based indicators derived from an executive opinion survey.
Competitiveness is defined by the WCY as “ability of a nation to create and maintain an environment that sustains more value creation for its enterprises and more prosperity for its people”.
This year’s results reflect the immediate impacts the US-China trade friction in 2019 and the shifts in executive opinion that may have been influenced by the COVID-19 pandemic as captured by the executive survey that ran from February to April 2020.
The full impact of the pandemic on macroeconomic factors were not yet captured in the results since the latest statistical data used in the study were from 2019.
Despite moving up one spot in the overall ranking, the Philippines did not improve in any of the four main factors or dimensions of competitiveness when taken individually. Economic performance declined by six notches from 38th to 44th; government efficiency went down one spot from 41st to 42nd; and business efficiency declined from 32nd to 33rd.
The Philippines did not improve its rank of 59th in infrastructure, an aspect where the country had been constantly faring poorly.
Some of the challenges that the Philippines face in 2020 include mitigating the economic impacts of COVID-19 and adjusting to the “new normal,” preparing the healthcare system for possible succeeding waves of COVID-19, ensuring adequate and prompt aid to vulnerable households and businesses, quickly resuming the government’s “Build, Build, Build” infrastructure investment program and reviving business and consumer confidence.
Singapore retained its top position for the second year in a row while Hong Kong dropped from its number two position in 2019 to 5th place this year due to weaker economic performance and concerns surrounding political stability.
The US experienced one of the largest declines in the overall ranking, falling from 3rd to 10th place this year due mainly to deterioration in levels of international trade and public finances as well as in employment and labor market numbers. China also dropped in the overall ranking from 14th to 20th place.